3.5 hours is not too long to leave your new puppy in his crate. However, I definately would not leave him in there longer than that. Here is an excellent webpage that will help you get a schedule down pat for your little one and crate training:
http://www.darnfar.com/Dog%20Trainin...ng_a_puppy.htm
Also I would not leave him in the bathroom by himself at night. He is used to being with litter mates and his mama. He has never been left alone before and I am sure he is just nervous and scared. If you REALLY don't want him to sleep with you, then I would put him in his crate at night and put his crate on your nightstand so he can see you. That way he won't feel alone. If you do want him to sleep with you, I would go ahead and let him sleep with you. Both of mine have slept with me since the day I brought them home and neither has ever messed in my bed. I think it is because they will not mess where they sleep. They will get up and move around if they have to go to the bathroom and when they start moving around, get up and take him outside. Wrap him up in a towel and lay a towel on the bed beside you for him to lay on. If he does happen to mess in the bed, at least it will be on the towel.